Oaktree Gives Molycorp’s Mine More Time: Distressed Debt
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Oaktree Capital Management LP is throwing Molycorp Inc. a lifeline with $400 million of loans that gives the company cash to operate until the first quarter of 2016 as its Mojave Desert mine moves toward full production.
The financing didn’t come cheap: Molycorp will pay an interest rate of 12 percent, the highest on a loan made in the U.S. this year, according to data compiled by Bloomberg. Not only that, Oaktree gets warrants to buy 10 percent of the miner of rare-earth minerals, which are used in electronic devices from Apple Inc.’s iPads to Raytheon Co.’s Tomahawk missiles.